Publications
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03.04.2010Seeking Shareholder Engagement: SEC Amends e-Proxy Rules to Increase FlexibilityUpdatesThe Securities and Exchange Commission recently adopted amendments to the e-proxy rules in an effort to increase shareholder participation in the voting process. Data indicates that, since the adoption of the e-proxy model, participation by retail shareholders has been lower when those shareholders receive only the Notice of Internet Availability rather than a full set of proxy materials.
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03.17.2009Sarbanes-Oxley Act Section 404(b) Reminder: Non-Accelerated Filers Must File Auditor Attestation Report on Internal Control Over Financial Reporting for Fiscal Years Ending on or After December 15, 2009UpdatesUnless the SEC grants another extension, a non-accelerated filer must provide its first auditor attestation report under Section 404(b) of the Sarbanes-Oxley Act in its SEC annual report for the fiscal year ending on or after December 15, 2009. A "non-accelerated filer" is a company that did not have a public float of $75 million or more on the last business day of its most recently completed second fiscal quarter.
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03.11.2009The SEC Speaks in 2009: Our Top TakeawaysUpdatesIn February 2009, at the annual SEC Speaks conference in Washington, D.C., senior staff of the U.S. Securities and Exchange Commission reviewed significant actions of the previous year and identified top priorities for the year to come. This update lists our top takeaways from the conference that may have an impact on your business.
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10.03.2008SEC Adopts Amendments to Rules and Forms for Foreign Private IssuersUpdatesThe SEC recently adopted amendments to rules and forms affecting foreign private issuers.
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02.07.2008SEC Permits Smaller Public Companies to Use Form S-3 Registration Statements for Primary Offerings of SecuritiesUpdatesThe SEC recently amended the eligibility requirements for companies to use Form S-3 registration statements to facilitate more efficient capital market access by smaller public companies.
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07.14.2006Website Posting of SEC and Corporate Governance Materials -- Required Postings and Practical AdviceUpdatesIn recognition of the central role of the Internet in today's global economy, many companies rely on their corporate websites as basic information sources and marketing tools for business partners, customers and the general public. In light of increased attention to corporate governance matters and recent SEC and stock exchange corporate governance requirements, public companies typically create within their corporate websites a separate page devoted to investor relations, and many companies also create separate pages devoted exclusively to corporate governance matters, such as information about the board of directors and committees.
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06.21.2006Delaware Supreme Court's Disney Decision Affirms the Business Judgment Rule and Endorses Compensation Committee Best Practices — "Quantify. Discuss. Document."UpdatesIn the Delaware Supreme Court's recent opinion in the Disney case, Justice Jacobs provided better "best practices" advice for compensation committee decision making (and by analogy, board and other board committee decision making) than we may have seen in decades. The court also rejected the argument that making a decision in the absence of adequate information and deliberation amounts to bad faith.
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01.11.2006SEC Proposal Exempts Compensation Arrangements From the Tender Offer Best-Price RuleUpdatesThe Securities and Exchange Commission recently proposed amendments to its tender offer "best-price rule," which it adopted in 1986 to prevent discriminatory tender offers by requiring that the highest price paid to any security holder in a tender offer must be paid to all other tendering security holders. Several court decisions interpreting the SEC's best-price rule have created uncertainty about whether compensatory and other arrangements made with a target company's officers, employees, directors and shareholders in an acquisition structured as a tender offer will be deemed tender offer consideration that is subject to this rule.
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08.18.2005SEC Clarifies Two Important Exemptions From Section 16(b) Short-Swing Profit LiabilityUpdatesThe Securities and Exchange Commission recently amended Rules 16b-3 and 16b-7 under the Securities Exchange Act of 1934, to clarify that Rule 16b-3 may be relied on to exempt officer and director securities transactions from Section 16(b) short-swing profit recovery, even if the transactions are not compensatory in nature, and Rule 16b-7 may be relied on to exempt stock reclassifications, even if they involve securities with different risk characteristics or change the percentage ownership of the holders.
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06.15.2005New Rules Force Research Analysts to Stay Home When Investment Bankers Hit the RoadUpdatesThe SEC recently approved new rules adopted by the New York Stock Exchange and National Association of Securities Dealers to limit conflicts of interest between the selling and research arms of investment banks. Under these rules, research analysts at investment banks may not participate in road show meetings relating to an investment banking services transaction or communicate with current or prospective customers while investment banking personnel or company management is present.
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11.23.2004NYSE Amends Listing Standards to Clarify Corporate Governance RequirementsUpdatesThe Securities and Exchange Commission recently approved and made effective amendments to the New York Stock Exchange corporate governance standards, Section 303A of the NYSE Listed Company Manual, primarily to clarify standards that were adopted last year. This Update summarizes the amendments and offers practical guidance.
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11.17.2003Perkins Coie Announces Second Edition of The Public Company Handbook: A Corporate Governance and Disclosure Guide for Directors and ExecutivesUpdatesPerkins Coie is pleased to announce the publication of the post-Sarbanes-Oxley second edition of The Public Company Handbook: A Corporate Governance and Disclosure Guide for Directors and Executives. Increasing Importance of Director Continuing Education We have designed this practical and easy-to-digest guide for directors and executives of public companies. This book has a particular relevance at a time when both the NYSE and Nasdaq, as part of their corporate governance initiatives, strongly encourage – some say mandate – continued director education.
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09.23.2003SEC Clarifies (and Tightens) Requirements for Pre-Approval Policies for AuditUpdatesIn publishing responses to a series of frequently asked questions (FAQ), the SEC's Office of the Chief Accountant has provided guidance about pre-approval policies and other matters relating to the SEC's auditor independence rules adopted in January 2003. Those rules became effective in May 2003 and, among other things, require a company's audit committee to pre-approve all audit and non-audit services provided by the company's auditors.
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09.16.2003Silence - and a Poker Face - are Golden: SEC's Schering-Plough Enforcement Action Shows SEC's Enforcement Focus on Nonverbal CuesUpdatesThe SEC has followed through on its promise to continue to focus enforcement efforts on Regulation FD and selective disclosure with its September 9, 2003 charges against Schering-Plough Corporation and its former CEO, Richard J. Kogan. In the most subtle of its FD enforcement actions, the SEC brought charges arising from both verbal and nonverbal selective disclosure of material, nonpublic information about Schering's earnings.
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06.26.2003Delaware Court Warns Directors and Officers on Oversight of Executive Compensation: In re The Walt Disney Company Derivative LitigationUpdatesOn May 28, 2003, the Delaware Court of Chancery issued a ruling that could expose directors of The Walt Disney Company (Disney) to personal liability for asserted breaches of their fiduciary duties in the hiring and subsequent termination of Michael Ovitz as Disney president—decisions that resulted in an alleged $140 million payout for a year's work.
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05.15.2003Whistleblower Provisions of the Sarbanes-Oxley Act - Some Practical ConsiderationsUpdatesThe Sarbanes-Oxley Act of 2002 contains two very different provisions addressing corporate "whistleblowers." This Update describes both:
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04.30.2003NASDAQ Refines Director and Committee Rule ProposalsUpdatesThe Nasdaq Stock Market recently issued several revised rule proposals regarding director independence, audit committee composition and function, and related corporate governance issues. This Update summarizes these proposals, which include only a few changes from the original rule proposals discussed in our October 18, 2002 Update.
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04.14.2003NASDAQ Eases Delisting Risk for Minimum Bid Price NoncomplianceUpdatesIn January 2002, Nasdaq adopted a "pilot program" offering relief for noncompliance with minimum bid price requirements for continued listing on the Nasdaq SmallCap Market. The pilot program lengthens the compliance or "grace" periods for Nasdaq-listed issuers whose shares trade below $1 per share and face the possibility of delisting.
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03.25.2003SEC Proposes Amendments to CEO and CFO Certifications Under Sarbanes-OxleyUpdatesThe SEC recently proposed amendments that would require companies to provide the officer certifications under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 as exhibits to periodic reports. Importantly, the SEC also indicated that Section 906 certifications should be provided as exhibits to periodic reports pending the adoption of final rules.
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02.04.2003SEC Finalizes Rules Prohibiting Insider Trading During Pension Fund Blackout PeriodsUpdatesOn January 28, 2003, the SEC published final rules implementing Section 306(a) of the Sarbanes-Oxley Act of 2002, which generally prohibits insider trading during pension plan blackout periods. These rules became effective on January 26, 2003; however, the requirement to file notices of blackout periods with the SEC on Form 8-K is not effective until 60 days after publication of the rules in the Federal Register. For blackout periods occurring between January 26, 2003 and February 25, 2003, reporting companies should furnish blackout notices to directors and executive officers as soon as reasonably practicable. Blackout notices are not required for currently effective blackout periods that started before January 26, 2003.
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01.18.2003SEC Proposes Rules to Implement Sarbanes-Oxley's Audit Committee Independence RequirementsUpdatesLast week, the SEC released proposed rules to implement the audit committee independence and whistleblower provisions of Section 301 of the Sarbanes-Oxley Act of 2002. Sarbanes-Oxley (Sec. 301) requires the SEC to adopt final rules by April 26, 2003, directing all national securities exchanges and national securities associations ("SROs"), including NYSE and Nasdaq, to prohibit the listing of any security of an issuer that is not in compliance with the audit committee requirements set out in Section 301. The proposed rules cover:
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11.19.2002SEC Proposes Rule Requiring Enhanced MD&A Disclosure of Off-Balance Sheet Arrangements, Contractual Obligations and Contingent Liabilities and CommitmentsUpdatesOn November 4, 2002, the Securities and Exchange Commission proposed an amendment to Item 303 of Regulation S-K that would require a registrant to include in Management's Discussion and Analysis of Financial Condition and Results of Operations:
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11.18.2002SEC Proposes Rules Governing Non-GAAP Financial InformationUpdatesOn November 5, 2002, the Securities and Exchange Commission (SEC) proposed new "Regulation G," as well as amendments to certain existing rules, that would require public companies to provide specific disclosure when releasing proforma or non-GAAP financial information, including reconciling that information to GAAP.
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10.18.2002NASDAQ Corporate Governance ProposalsUpdatesLast week the Nasdaq Stock Market delivered to the SEC several new and revised Nasdaq rule proposals, for publication in the Federal Register for public comment. These proposals reflect Nasdaq's continued response to the SEC's request made in February 2002 for corporate governance reform of Nasdaq listed companies.
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09.06.2002Recent SEC Final Rules: CEO and CFO Certification of Periodic Reports and Disclosure Controls; Accelerated Form 4 and Annual and Quarterly Report Filing DeadlinesUpdatesLast week the SEC adopted final rules under Sections 302 and 403 of the Sarbanes-Oxley Act of 2002:
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07.01.2002SEC Proposes to Restructure Form 8-K and Accelerate Form 8-K FilingsUpdatesFor the first time in 25 years, the Securities and Exchange Commission plans to significantly restructure Form 8-K. Under the SEC's June 17, 2002 proposal, a reporting company would be required to disclose many events on Form 8-K that currently are not required to be disclosed or are included only in annual or quarterly reports. If adopted, the new rules would require Form 8-K disclosure of the following events: